Enel Europe’s Biggest Utility Is Sending Its Staff to Tech Boot Camp, Enel X
- Europe’s biggest utility has created its Enel X tech unit
- The unit is trying to move Enel from energy to tech company
The future of energy is not energy. At least, not for Italy’s Enel SpA.
Europe’s biggest utility is quietly shifting hundreds of employees and senior managers to a newly refurbished office in Rome’s suburbs — whose informal dress code, open-air spaces and shared kick scooters give it an air of a tech start-up. The unit, dubbed Enel X, is tasked with finding the next big money maker for Enel, transforming the utility into a technology company.
“We are the Google of energy; The business models are the same,” Enel X Chief Executive Officer Francesco Venturini, said during an interview in the new office, where employees discuss innovation around table soccer and board games. The spaces, physically separated from Enel headquarters to allow staff to think more creatively in a dynamic environment, have gleaming white walls with special paint that allows people to use them as a writing boards.
Enel’s move reflects a period of profound transformation in the utility business as government policy changes, tougher competition, and lower profitability from existing assets bites into earnings.
To find new growth, Enel is seeking to expand in downstream services, an area in which some of its peers such as Centrica Plc and E.ON SE are going strong. Enel X will focus on four main areas: electric mobility and batteries services, consultancy services for businesses, broadband and grid services, and a division working on smart homes.
“Technology brought disruption to the energy industry. We are here to find a way that allows technology and services to become an opportunity,” said Venturini, who previously headed the company’s renewables business.
Enel was among the first to invest heavily in renewables, becoming one of the largest green power operators in North America. As incentives for renewable energy dried up, the company started to look elsewhere.
“Utilities’ line of defense from price pressure is to be able to compete on services as well as prices, and this will be done through new technologies,” said Javier Suarez, an analyst at Mediobanca SpA in Milan. “Energy companies, including Enel, need to provide different services to the same consumer.”
About two years ago, when the industry started to focus on the rise of electric cars and the importance of batteries, Enel began to put together a separate unit that could work with tech start-ups. The four areas the company has identified are an attempt to piggy back off some of the advantages the utility has — a client network, for instance.
E-homes is one of the areas in which the company is venturing farthest from its core business with a credit card product designed for lower income households. Access to people’s electricity bills allows Enel to track down customers that miss payments. The service is currently only offered in Colombia but could expand.
“We are trying to understand if we can play a significant role in micro-finance and payments. We have access to 600 million people, this gives us an edge,” Venturini said.
So far, the greatest interest from clients has been on energy efficiency consultancy, an area in which Enel is working closely with clients such as the pharmaceutical industry, which requires extremely stable power provision. Apps that control electricity flow from remote and smart boxes can help some clients cut their electricity bill.
Enel also announced a number of acquisitions in recent months, including that of EnerNOC Inc, one of the biggest U.S. players in energy management.
On Thursday, Enel announced a partnership with PwC Advisory to work on the development of corporate electric mobility and foster the sustainable development of the transport sector.
Looking ahead,the big opportunity in the industry is going to be developments in electric cars. Trials done by the company in collaboration with Nissan Motor Co. in Denmark have shown that car batteries can be used both to power vehicles but also to give some of their stored energy back to the grid, a service for which the owner receives payment.
In the parking lot outside Enel X’s new office most cars are electric and can be connected to a charging station via an app.
“Electric cars are coming for sure, but soon they are also going to become a money-making opportunity for their owners,” Venturini said. “We are working to make this possible. This is what we’re here for.”
VIDEO: Courtesy Enel X